Big future in Broadcom's little set-top box?

Broadcom has built a set-top box smaller than a deck of cards.
Shara Tibken/CNET

When the Super Bowl kicks off Sunday evening, most people will fire up their cable boxes to catch the big game.

But what if your cable box were smaller than a deck of cards and hid behind your TV like a Google Chromecast, freeing up precious space on your coffee table for another tray of nachos?

That may one day become reality for cable set-top boxes, according to Broadcom, an Irvine, Calif., company that makes chips for WiFi, Bluetooth and other forms of connectivity. The company has developed a small TV dongle that looks more like the Roku Streaming Stick and Amazon Fire TV Stick than the cable boxes found in most homes today. Broadcom isn't selling the device. It's a way for the company to show its customers -- big cable providers like Comcast and Liberty Global -- what's possible.

"Everybody is looking at it," Rich Nelson, senior vice president of marketing for Broadcom's broadband and connectivity group, said in an interview.

The rising cost of cable and the abundance of online video options (and gadgets that can ferry online programs to your television) have more people questioning why they pay for cable TV. Cable companies, faced with more customers willing to dump their service plans, have been exploring ways to keep their subscribers happy. That includes offering new ways to access content -- such as streaming live TV on tablets -- as well as new hardware that improves the viewing experience.

By the first quarter of 2017, 40 percent of homes in the US with Internet access will have a streaming-media player, according to a study by market researcher NPD. At the beginning of 2014, the total was only 16 percent. The increased use of streaming-media players has boosted streaming-content services such as Netflix, YouTube and Amazon -- competitors to the traditional cable companies, NPD Group said.

"Over the coming years we will continue to see a growing audience of TV viewers for streaming-video services, authenticated network apps, and offerings such as CBS All Access that no longer require a pay TV subscription from a cable or satellite provider," said NPD analyst John Buffone. (Editor's note: CBS All Access and CNET are both owned by CBS.)

Shrink it down

The increase in streaming video makes it even more vital for cable providers to offer services and hardware to keep their customers.

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Broadcom's set-top "concept device" goes beyond the many streaming-media sticks already on the market. It also delivers a service provider's full cable offerings along with on-demand video and DVR. The stick additionally has stronger Wi-Fi capabilities, Nelson said, and can stay awake for updates while the TV is off. Streaming-media sticks today typically get their electricity from a TV's USB plug, which means they lose power when the television is turned off. The dongle that Broadcom created uses a special HDMI port found in new TVs to stay on around the clock.

Overall, it's "more robust" than streaming-media sticks, something Nelson said is vital for cable companies that provide a monthly service. Streaming-media sticks, which typically cost about $30 to $50, are seen as more disposable.

"If you go out and buy a Chromecast...and it doesn't work, you just throw it in your kitchen drawer," Nelson said. "But if you get something from Comcast and it doesn't work, you call them and they have to send a truck to your house. It's very expensive for them to do."

Cable providers are looking at Broadcom's new box, but that doesn't mean they'll end up deploying it to customers in its current form. There are some operational issues that need to be worked out, Nelson said. That includes Wi-Fi performance, which can suffer because of the dongle's placement behind the TV.

Rapid-fire speeds

One thing service providers will start distributing this year: set-top boxes that play 4K Ultra High Definition video. DirecTV, Dish and Comcast, for instance, have all jumped on board with the 4K push.

"If you go out and buy a 4K TV, you're going to look for a service provider that has some 4K [content]," Nelson said. "Typically, the people buying 4K TVs tend to be [the cable companies'] best customers, so they don't want to lose those customers."

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To get 4K content streamed to your home, you also need faster Internet. Ever since Google started rolling out its inexpensive, 1-gigabit-per-second fiber network in 2011, Internet service providers have been scrambling to provide faster broadband for subscribers.

According to a "State of the Internet" report by Akamai in January, 4K video streaming generally requires speeds of 10Mbps to 20Mbps. But only about 12 percent of worldwide connections to Akamai, one of the world's largest globally distributed networks, were "4K ready," with speeds above 15Mbps, in the third quarter. The US, with about 19 percent of connections "4K ready," didn't rank in the Top 10 in terms of the most prepared countries.

And the Federal Communications Commission on Thursday rewrote the definition of high-speed Internet, raising the standard for broadband to 25 megabits per second from 4Mbps, while raising the upload speed to 3Mbps from 1Mbps. The new definition effectively means that millions of Americans subscribing to Internet service that clocks in at less than 25Mbps are no longer considered "broadband" subscribers. The average speed of service delivered in the US is 10Mbps.

"Our challenge is not to hide behind self-serving lobbying statements, but to recognize reality," FCC Chairman Tom Wheeler said at the meeting setting the new standards. "And our challenge is to help make that reality available to all."

Helping cable companies boost their broadband speeds is another area where Broadcom comes in. The company in January unveiled its first processor that will allow cable companies to provide broadband speeds up to 5 gigabits per second and upload speeds up to 2 gigabits per second. Perhaps even more important: The companies will be able to provide the faster speeds without tearing up streets to overhaul their infrastructure.